To provide further details on the setting of fees associated with Hackney Carriage and Private Hire Licensing.

Transcription

1 Agenda item: Committee: Licensing Committee Date of meeting: 17 February 2005 Subject: Author: Portfolio Holder: Policy/budget ref: Exempt information: Delegated status: Hackney Carriage and Private Hire Licensing Fees Civic Centre Manager Councillor J Bartlett ED200 None Recommendation PURPOSE: To provide further details on the setting of fees associated with Hackney Carriage and Private Hire Licensing. RECOMMENDATION: DETAILS OF THE FEE STRUCTURE IN RESPECT OF PRIVATE HIRE AND HACKNEY CARRIAGE LICENCES BE NOTED. THE APPROPRIATE FEE STRUCTURE BE SELECTED FROM THOSE AT APPENDIX B FOR RECOMMENDATION TO CABINET AND, SUBJECT TO THE OUTCOME OF PUBLIC CONSULTATION, IMPLEMENTATION FROM 1 APRIL THE OUTCOME OF THE MEETING BETWEEN THE PORTFOLIO HOLDER REGULATORY AFFAIRS, CHAIRMAN OF THE LICENSING COMMITTEE AND THE PRIVATE HIRE OPERATORS BE NOTED. REPORT: 1. Background 1.1 At its meeting on 24 th January 2005, and in considering the recommendations regarding Hackney Carriage and Private Hire licence fees, the Licensing Committee requested that the Civic Centre Manager provide a further report covering the following issues; the components forming the basis of the Private Hire and Hackney Carriage licence fees. justification for Private Hire licence fees being set at a higher level than those for Hackney Carriage licence fees. a comparison between the fees levied by Elmbridge Borough Council and those levied by other Surrey District and Borough licensing authorities. fee options for Hackney Carriage and Private Hire licence fees (to be implemented from 1 April 2005).

2 1.2 Details of the main differences between Hackney Carriage and Private Hire services are attached at Appendix C. 1.3 At the Licensing Committee on 24 January 2005, the Chairman advised the that the Private Hire trade had made a number of representations regarding the difference in fee levels levied for Private Hire licences when compared to Hackney Carriage, as they perceived the difference could not be justified. 1.4 On 8 February 2005 a meeting was held between the Private Hire Operators (including representatives from the recently formed Elmbridge Private Hire Association) and the Portfolio Holder - Regulatory Affairs and Chairman of the Licensing Committee. The Civic Centre Manager and Enforcement Officer were also in attendance. This meeting was to progress discussions regarding; self adhesive licence plates for Private Hire vehicles. the fee differential between Private Hire and Hackney Carriage licences. 1.5 The Elmbridge Private Hire Association advised that their members were still unhappy about the proposed introduction self-adhesive plates, despite further options tabled and reassurances given. Following discussion it was agreed that the Association would, on behalf of the Private Hire trade, provide suggestions for a suitable design and forward this for consideration by Members. 1.6 With respect to fees, the Chairman of the Licensing Committee advised those attending the meeting that a report concerning the setting of licensing fees was to be considered by the Licensing Committee at its next meeting on 17 February Being mindful of the budget setting process, a further meeting would be held with the Private Hire Operators Association in due course. 2. Legislative Background 2.1 The Local Government (Miscellaneous Provisions) Act 1976, which governs Hackney Carriage and Private Hire licensing, recognises that although it is legitimate for the licensing authority to recover the costs incurred in providing this service, these costs must be reasonable. The test of reasonableness contained within Section 70(2) of the Act, states that the following procedure should be followed as part of the fee setting process; a notice must be placed in a local newspaper, and at the Council offices, stating the proposed fees and allowing a period of 28 days for objections to be lodged. This must also detail where and how any objections should be made. (The notice is also made available on the Council s website at once the objection period (usually another 28 days) has expired, if no objections have been received, or if any objections made have subsequently been withdrawn, then the new fees may take effect either at the end of the objection period or when the last objection has been withdrawn. if objections are not withdrawn, then the Council must consider the objections and in the light of their consideration set a second date, which cannot be more than two months after the first date specified when the new fees come into effect. (Although

3 the Council must consider the objections it is not obliged to vary the proposal as a result of them). 3. Resource Allocation - Context 3.1 The framework for setting Hackney Carriage and Private Hire licence fees considers the following items all of which are considered below in greater detail, namely; licence number by type. licensing staff time and task allocations. financial resource allocations. 3.2 From the following table, it is evident that there are a significantly greater number of Private Hire licences when compared to Hackney Carriage. This leads to a higher workload per month, even when based purely on straightforward licence renewals. For comparison, the percentage of the total number of licence renewals per month is also shown. Licence Type Number Average renewals per month % Of Total Licence Renewal per month Hackney Carriage Driver Private Hire Driver Hackney Carriage Vehicle Private Hire Vehicle Private Hire Operator In addition to licence renewals, which involve significant administration, other regularly undertaken tasks include: advising existing and potential licensees at the reception counter (85% of all enquiries are Private Hire licensing related) issuing reminders for insurance certificates (including second follow up and suspension of the licence where necessary). It is considered essential to hold current insurance details for all licensed vehicles on file and therefore where these are not present licensees are sent a reminder. A proportion of the licensees are repeatedly non-compliant in this respect. For the period July to September 2004 licence reminders were issued as follows; o July - 78 insurance reminders issued 59 to Private Hire and 19 to Hackney Carriage. o August - 86 insurance reminders issued 73 to Private Hire and 20 to Hackney Carriage. o September 66 insurance reminders issued 53 to Private Hire and 13 to Hackney Carriage. o For comparison in January 2005, 62 insurance reminders were issued 49 to Private Hire and 13 to Hackney Carriage. issuing reminders for MOT/Taxi tests including follow up where necessary and

4 arranging MOT/Taxi test appointments at the appointed Test. (To ensure quality control and consistency of MOT tests all vehicles are tested at Test Centre, checked and approved by the licensing team for this purpose. (This is not common practice within the majority of other licensing Authorities who accept an applicant s own MOT as part of the licensing application process). re-arranging tests for vehicles that fail the MOT/Taxi Test and undertaking vehicle inspections on those vehicles that subsequently pass. In % of vehicles that failed an MOT test were Private Hire vehicles. Criminal Records Bureau check administration. undertaking spot checks on car tax. Recently during a spot check three Private Hire and one Hackney Carriage vehicles did not have this in place. administration of medical checks in liaison with Medical Officer, including follow up on her behalf as appropriate. (This is to ensure that medical clearance is to the required Group 2 standard, which is a DVLA recommended standard for taxi and private hire drivers and is a more stringent assessment. Unfortunately the applicants General Practitioners do not tend to assess to this standard). undertaking knowledge tests (Hackney Carriage knowledge tests take longer to administer but as the Hackney Carriage trade is more stable the majority of knowledge tests are for Private Hire applications). processing new applications (from receipt to signing off). administration relating to the substitution of vehicles (usually for a newer vehicle) enforcement activities both within the office and enforcement visits. Forwarding medical examinations to the Medical Officer for clearance and arranging for any follow up tests on her behalf. Enforcement interviews with licensees. Enforcement visits around the Borough, both programmed and as required. During an average week, the licensing team spend the equivalent of 3.75 days dealing with matters relating to Private Hire licensees. 3.4 The average length of time that Hackney Carriage driver holds a licence is 10 years compared to 2 years for Private Hire driver. This tends to result in Hackney Carriage drivers demonstrating a significantly higher level of understanding of and compliance with licence conditions, which reduces the need for enforcement in this area. 3.5 The above tasks are allocated across the licensing team, the post holders and their respective time allocations are detailed below. Civic Centre Manager 15%. Office Manager - 80% Licensing Enforcement Officer - 95% Administration Officer 95% 0.5 full time equivalent Administration Officer 35%

5 3.6 Overall in setting the fees the following costs must be accounted for. Item Salaries and associated on-costs for licensing staff administration Salaries and associated on-costs enforcement Medical Officer (to ensure that all applicants meet the Group 2 medical standard, including requesting and reviewing further investigations as appropriate). Purchase costs of all licence plates, badges, brackets, pouches, etc. Item Cost of vehicle checks (taxi test). Advertising, office equipment, stationery, etc Office accommodation and central support costs (including payroll, legal services, financial services) Basis of Apportionment By the proportion of the total number of licensees in each licence group. A higher percentage of the enforcement costs are allocated to Private Hire licences, to reflect the amount of work in this area. Allocated by number of drivers in each licence group. Allocated by number of drivers and vehicles in each licence group. Basis of Apportionment By vehicle numbers. Allocated by number of total licensees within each group. As per salary allocations. 3.7 In recent years Members have made vehicle licensing enforcement a service priority and as a result have allocated additional staffing resources to this function. Although this has lead to an increase in licensing fees it is also, through a commitment to working in partnership with licensees, providing an increasing level compliance with licence conditions and a safer and more reliable service for the public. 3.8 The increased commitment to licensing enforcement resulted from a change in service need following the realignment of the Metropolitan Police Boundary in April Between April 2000 and December 2004 there was a significant and sustained increase in licensee numbers, particularly with respect to Private Hire licensees. Recently there has been a slight decrease in licence numbers with the majority of these being in the Hackney Carriage licensees. 3.9 Following the boundary change, it became evident that the staffing structure at that time was inadequate to effectively administer the licensing function. Furthermore, very little licensing enforcement activity was undertaken. Recognising the need for increased enforcement activities to ensure licence compliance, Members reviewed the staffing structure and in November 2002 a Licensing Enforcement Officer was appointed. Since that appointment a significant increase in compliance has been achieved. The continuing enforcement activities ensure that a high level of compliance and standard of Private Hire and Hackney Carriage services are provided to the public. 4. Comparison with Other Authorities 4.1 Although the Local Government (Miscellaneous Provisions) Act 1976 governs the process for introducing and revising licence fees, the actual fee levels are set as part of

6 a local decision process. Even for those elements that are undertaken by all authorities, for example an enhanced Criminal Records Bureau assessment for drivers, some authorities (including Elmbridge) charge the fee set by the CRB whereas others add an additional administration charge to the fee. Such local control allows fees to be set to reflect the staffing requirement, level of enforcement required, driver knowledge assessment, etc. Once set the potential fee is approved by Members and undergoes public consultation prior to implementation (this process includes a post consultation review by Members if required). 4.2 The following table provides a comparison of licence numbers by type across Surrey licensing authorities. A comparison of fees for the same Authorities is provided at Appendix A. 4.3 Elmbridge Spelthorne Licence Type Hackney Carriage Driver Hackney Carriage Vehicle Private Hire Driver Private Hire Vehicle Private Hire Operator Waverley Reigate & Banstead Guildford Runnymede Woking Surey Heath 4.4 From the above table it can be seen that Elmbridge has the third highest number of Private Hire and Hackney Carriage licensees when compared with other Surrey District and Borough licensing authorities, and this, in part, accounts for some of the differences within the licence fee. 4.5 With respect to staff resources allocated to vehicle licensing across the Surrey licensing authorities, Elmbridge has a higher level of staff allocated to this function particularly in respect of licensing enforcement. However, it would appear that Elmbridge undertakes a significantly higher level of programmed and proactive enforcement, which was not and would not be possible with lower staffing resources. 4.6 From the table at Appendix A comparing Hackney Carriage and Private Hire fees levied by licensing authorities within Surrey, it can be seen that Elmbridge fees are broadly comparable with those set by the other licensing authorities. However, this table also illustrates the local nature of fee setting. It is recognised that the only other authority to have a significant difference in the fee between Hackney Carriage and Private Hire is Reigate and Banstead, but in this case it is hackney fees that are the higher. 5. It is noted that in a number of other authorities issue a three-year driver s licence. Should Members wish to further consider this option, it is suggested further consultation with those licensing authorities that have adopted this policy take place, along with consultation with the Hackney Carriage and Private Hire trades, and the public, and a further report produced in due course.

7 6. Fee Proposals 6.1 Costs associated with administering Private Hire and Hackney Carriage services are recovered via the respective Hackney Carriage and Private Hire licence fee. The fee is dependent on the percentage of costs allocated to each licence type. In the past the apportionment was on the basis of an equal allocation of costs between Hackney Carriage and Private Hire licences. However, given the higher workload associated with Private Hire licensing it was felt that this was an inequitable basis on which to proceed and that a fairer allocation would be on the basis that any increase reflects the work involved with the particular licence type. To this end, in the last two years Private Hire fee increases have been higher than those for Hackney Carriage licences. The increases proposed for financial year 2005/05, and approved by Council in December 2004, reflect this trend. 6.2 Appendix B outlines the options for fees increases and the impact that this will have on the respective fee levels. Members are requested to recommend their preferred option from those detailed in Appendix B. Members are advised that the only option to have been approved by Council is Option 1. The selected option will need to be forwarded for public consultation, and if necessary further consideration by Members, prior to implementation. 6.3 At its meeting of 24 January 2005, Members considered the provision of additional Hackney Carriage ranks throughout the Borough. If extra ranks are provided this will increase the enforcement requirement, particularly during implementation and initial operation phases, following which it would be necessary to review the position. To cover this requirement, it is proposed that an additional Licensing Enforcement Officer be appointed, initially on a two year fixed term contract. 6.4 As previously identified the workload associated with the administration of Private Hire licences is higher than that associated with Hackney Carriage licences. This results in a significantly higher fee being levied for Private Hire licenses. A number of options are detailed below and detailed at Appendix B o Option 1 details the fee proposal approved for consultation by Council in December o Option 2 details a realignment of the fees which, to close the gap between the two licence types, allocates a higher percentage of the costs to Hackney Carriage and to reduce the impact of increased costs on Private Hire drivers and vehicle licences allocates a higher percentage of Private Hire costs to Private Hire Operators. o Option 3 details the impact of employing an additional Licensing Enforcement Officer (see paragraph 6.4 below). This option is proposed if further taxi ranks are introduced around the Borough and further enforcement is required. Although the financial impact of this proposal is primarily borne by the Hackney Carriage licensees, given the opposition expressed by Private Hire Operators in respect to the introduction of ranks it is felt that increased enforcement would be needed in both licensing areas and therefore costs should be allocated across both licence fees although the fee differential between Hackney Carriage and Private Hire licences would decrease.

8 Financial Implications: As detailed in the report and Appendices. Environmental implications: None for the purpose of this report. Legal implications: Local Government (Miscellaneous Provisions) Act 1976 with respect to fee setting. Equality Implications: None for this report. Risk Management Implications: Ensuring compliance with licence conditions. Community Safety Implications: Providing a safe means of public transport Background papers: With Civic Centre Manager Enclosures/Appendices: Appendix A comparison of Hackney Carriage and Private Hire licence fees Appendix B licence fee options. Appendix C comparison of Hackney Carriage and Private Hire Services. Contact details: Tina Bailey, Civic Centre Manager , tbailey@elmbridge.gov.uk

9 Appendix A New HCD Renew New HCV Renew New PHD Renew New Renew 1 HCD 2 3 HCV4 1 PHD2 PHV3 PHV4 Elmbridge Spelthorne Waverley Runnymede Reigate and Banstead <4yrs) 148 <4yrs) <4yrs) 176 (> 176 (> 4yrs) 176 (> 4yrs) 4yrs) 148 <4yrs) 176 (> 4yrs) ` Surrey Heath Guildford Annual equivalent Woking Annual equivalent > 3 years <3 years Annual equivalent 82/98 82/98 82/98 82/98 Average licence fee (excluding Elmbridge) Elmbridge Key and Notes (Code relates to that at top of each column) Elmbridge Guildford HCD1 - includes licence, knowledge test and CRB HCD1 includes application fee and knowledge test and is for 3 years PHD1 includes licence, knowledge test and CRB HCD3 includes 2 tests and a plate HCV3 & PHV3 includes deposit for plate Spelthorne HCD3 includes licence, plate deposit and bracket PHD1 includes licence and CRB PHV3 licence, plate deposit and bracket Waverley HCD1 includes licence and CRB PHD1 includes licence and CRB Woking HCD1 & PHD1 - Woking 3 year licence incl driver agency test and CRB HCV3 & PHV3 & 4 differented by vehicle & includes plate deposit year 1 Woking offer either a 3 year or one year renewal Surrey Heath HCD1 and PHD1 include CRB check Reigate and Banstead HCD1&2 includes licence fee and search fee & is a 3 year licence Vehicle licences are annual and differentiated by age of vehicle

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11 Option 1 - Fees Approved by Council December 2004 Appendix B Type of Licence Charges Projected Current Proposed Change Increase in Income % Drivers: Hackney Carriages Private Hire ,412 Total 1,706 Vehicles: Hackney Carriages Private Hire ,240 Total 4,150 Operators: Operator with up to 5 vehicles Operator with 6-10 vehicles Operator with vehicles Operator with vehicles Operator with vehicles Operator with vehicles Operator with vehicles Operator with vehicles Total 365 Grand Total 6,221

12 Option 2 Increase Hackney Carriage and Opeator Fees and Maintain Private Hire Driver and Vehicle Fee Appendix B Driver HC Driver PH Vehicles HC Vehicle PH Operator Total Budget Business Plan Direct Employees 2,737 25,775 7,585 41,733 4,540 82,370 Running Expenses 3,971 15,528 6,059 20, ,870 Directorate Admin , ,500 Direct Office Expenses 1,018 5,342 2,554 9,056 1,060 19,030 Central Support 1,978 10,382 4,963 17,597 2,080 37,000 Total Expenditure 9,744 57,427 21,466 91,128 9, ,770 Sundry Income -2,041-10, ,000 Income-Fees & Charges -7,743-40,252-21,528-91,140-15, ,773 Net Expenditure -40 6, ,105-3 Numbers Current Charge Proposed Fees Increase % 3% 2% 0% 18% - 56% Band A Band B Band C Band D Band E Band F Band G Band H

13 Option 3 - Including Additional Enforcement Resources Appendix B Driver HC Driver PH Vehicles HC Vehicle PH Operator Total Budget Business Plan Direct Employees 13,445 30,642 7,585 41,734 8, ,839 Running Expenses 3,971 15,528 6,059 20, ,870 Directorate Admin , ,500 Direct Office Expenses 1,018 5,342 2,554 9,056 1,060 19,030 Central Support 1,978 10,382 4,963 17,597 2,080 37,000 Total Expenditure 20,452 62,294 21,466 91,129 12, ,239 Sundry Income -2,041-10, ,000 Income-Fees & Charges -18,334-51,356-21,528-91,140-12, ,193 Net Expenditure Numbers Current Charge Proposed Fees Increase % 31% 2% 0% 9% - 30% Band A Band B Band C Band D Band E Band F Band G Band H

14 Hackney Carriage And Private Hire Licensing - An Overview Appendix C Hackney Carriages Commonly known as Taxis As with every part of England and Wales, Elmbridge has taxis. In practice there are two different types of vehicle and service; Hackney Carriage and Private Hire vehicles. The public generally perceive that these offer the same service but in reality they do not. There are considerable similarities between Hackney Carriage and Private Hire vehicles and their use, but there are also some significant distinctions. The differences between the two are, from a licensing perspective important, but, from a user s standpoint less so. The main similarity between the two types of vehicle (and therefore, those who drive them and control them) is that both transport members of the public to a specific destination on request, in exchange for payment of a fare. Public safety is paramount in the licensing regimes that govern these vehicles, their Drivers and Operators, whether this is to prevent direct danger to the passenger from the Driver of the vehicle or a danger to the passenger and other members of the public from the vehicle itself or the way in which the vehicle is driven. In relation to a Hackney Carriage Driver, there is a range of criteria, which have to be satisfied before a person can be granted a licence. These are primarily concerned with ensuring that the person is a fit and proper person to become a licensed Hackney Carriage Driver and includes the length of time they have held a driving licence (minimum of 12 months), and ensures they are medically fit (to the DVLA s Group 2 standard), pass an enhanced Criminal Records Bureau check and have adequate knowledge of the locality in which they work. The main features of a Hackney Carriage are; it can carry passengers for hire and reward; it can be hailed by a prospective passenger; and it can park on a rank to await the approach of passengers. A Hackney Carriage must be driven by a person who holds a Hackney Carriage Drivers licence. Each Hackney Carriage is individually controlled and is available for public hire. The local authority determines the fares that the Hackney Carriage proprietors charge for this services, with increases being requested by the Hackney Carriage Drivers and the levels set being subject to public consultation prior to implementation. The fares are displayed on a meter. Once a Hackney Carriage is plying for hire within the boundaries of the authority of which it is licensed, there are only a few reasons the Driver can use to refuse to taken a passenger and, and once the vehicle has been hired, the hire is then contractually bound to pay the fare.

15 Private Hire - Commonly Known As Minicabs. Private Hire services are a more recent development and were introduced under the Local Government (Miscellaneous Provisions) Act A Private Hire vehicle cannot not ply for hire or stand in a rank. It must be pre-booked with a Private Hire Operator. The Private Hire Operator is the lynch pin of the Private Hire vehicle licensing regime. He/she takes the booking for a Private Hire vehicle and dispatches the vehicle (which must be driven by a licensed Private Hire Driver of the same authority as the Operator). To fulfil that request a Private Hire vehicle cannot operate independently from a Private Hire Operator. The legislation places considerable duties on Private Hire Operators to ensure that the vehicles and Drivers, which they operate, are properly licensed. In licensing Private Hire Drivers, once again, the licensing authority will consider whether the person is fit an proper to hold a licence. In relation to Private Hire Drivers they must have held a full Driver s licence for at least one year, undergo a medical check to Group 2 standard and successfully complete an enhanced Criminal Records Bureau check. Within Elmbridge we insist that they pass a knowledge test. In respect to Private Hire vehicles, licensing authorities can impose conditions on the size, number of doors, passenger space, seats luggage space, conditions etc of the vehicle. They also have the power to impose conditions upon Operator and Driver s licenses, in order to govern their behaviour and conduct. Another difference between Hackney Carriage and Private Hire vehicles is in their fares. The local authority has no power to prescribe fares for Private Hire vehicles, as these are set by the Operator and led by market forces. The fare for a journey should be determined at time of making a booking with the Operator and agreed by customer. Once agreed this forms the basis of a contract being made for journey as booked. The local authority not only grants licenses for Hackney Carriages Drivers and vehicles, Private Hire Drivers and vehicles and Operators, but it also enforces the local authority the provisions that apply to them. This means that it must ensure that licensees comply with both the legislation and any conditions that it may impose upon them. The local authority will take action against those who are unlicensed, having the power to suspend, revoke or prosecute depending on the severity of the offence, in the interests of public safety.